April 22, 2002 -- IMF Staff Papers - Volume 49, Number 1, 2002--Money Demand in Mongolia: A Panel Data Analysis by Torsten Slok
This paper investigates if there is a significant money demand relationship in Mongolia. The data used is a panel data set covering 22 Mongolian regions over the period 1993-99. The static fixed effect, dynamic fixed effect, and the pooled mean group estimators all confirm the key role of monetary policy in stabilization and reveal that even in a transition economy as rudimentary as Mongolia, a stable money demand exists. In addition, the analysis points to an elasticity of money demand with respect to activity around 0.5, reflecting the larger role for transactions demand for money.